Question: I just turned 60 and feel like I should be planning for retirement. What dates/ages should I be aware of?

Answer: Well happy belated birthday! 60 is such a great age to be, but of course I always say that! Every day we have is an opportunity to have a great day!

I will start with an age you have already attained, 59½. At this age you could begin taking withdrawals from your Individual Retirement Accounts (IRAs) and other retirement plans like 401(k) or 403(b) without any penalty. Remember these funds were usually put into these accounts as pre-tax dollars, so withdrawal does mean you may owe income tax on the withdrawal. You also want to be sure these funds will last your lifetime, so taking out early may impact your income in later life.

The next age that is usually significant is age 62. The age of 62 is earliest date you could be eligible for Social Security Retirement benefits, or spousal benefits. When you decide to file for Social Security (SS) you will receive a lower monthly payment over the course of your lifetime. This income also may be taxable income, depending on other income you have and your total annual income. When considering filing for early SS benefits, it is important to understand you may receive MORE monthly payments over the course of your lifetime, but that monthly amount will be less than if you wait to begin collecting at a later date.

It is also important to understand that if you are working and decide to file for your SS benefit there are earning limits to be aware of. If you earn less than $22320 annually, you could collect your SS and have no reduction in your SS benefit. If you file for SS and make more than $22320 annually SS will hold back part of your benefit each year until you reach full retirement age.

The next age that is usually significant is age 65. Now you must realize this is my favorite age to talk about, because it is the age that most of us become eligible for Original Medicare benefits! When you get close to your 65th birthday, it is time to start thinking about Medicare and if you need that insurance coverage of not. If you are working, you may not need Medicare. If you are covered by your spouse’s employer coverage you may not need Medicare. If you are retired, you probably need Medicare.

At the very least the three months before your 65th birthday, the month of your 65th birthday and if you haven’t made your choice by then, the three months after your 65th birthday are months when you should be researching and making your Medicare enrollment decision. You may decide you need Medicare and you may decide that your current insurance is creditable and therefore you don’t need to do Medicare right now.

There is lot of information out there about this Medicare timeline and it is important to evaluate your decisions carefully, as there are penalties if you make the wrong decision. Take the time to do some research, or meet with someone who understands the rules and how those rules impact your decision.

The next age that is significant for most of us is slightly different based on your year of birth. For those born after 1938 full retirement age is different each birth year. Now you were probably born in 1964 (because you just turned 60). For you, full retirement age is 67. We will stick with that timeline for this discussion.

When you reach your full retirement age, you can file for SS benefits even if you are working. There won’t be any benefits held back from your SS because you are still working. You also will continue to earn credit towards your SS benefit even while collecting SS and working. When you file at your Full Retirement Age, you will receive a higher monthly amount than if you file for benefits earlier. Full Retirement Age is the most common age that individuals file for their SS benefits.

For individuals wanting to determine their full retirement age for SS, I would recommend using the www.ssa.gov website. This site will provide you with accurate data and also could provide additional information about your SS benefits.

The last significant age is 70. When an individual has postponed collecting their SS benefit, this is the last age that the benefit continues to grow in the monthly payment. Some individuals put off filing for their SS until age 70 so that their monthly deposit is the highest possible amount. These individuals may collect fewer monthly payments over their lifetime, but the amount deposited into the bank is the largest amount available to them.

I hope that gives you the information you need to move towards this stage in your life and evaluate some of the choices you have ahead of you.